The government collected Rs2.46 lakh crore from indirect taxes and Rs3.80 lakh crore from direct taxes in the past fiscal, according to provisional figures
The Centre mopped up Rs2.46 lakh crore from indirect taxes in the last fiscal, as much as Rs2,000 crore more than the revised target, despite stimulus packages, reports PTI.
On the other hand, it collected Rs3.80 lakh crore from direct taxes against the revised estimate of Rs3.87 lakh crore, Union revenue secretary Sunil Mitra said at a function hosted by the Bengal National Chamber of Commerce and Industry today.
However, Mitra clarified that these were only provisional figures, and the final ones would be released by the Controller General of Accounts.
Sources said that direct tax collections would go up further when final figures come in.
Estimates of indirect tax collections were revised downwards to Rs2.44 lakh crore for the last fiscal, from the Rs2.69 lakh crore estimated at the time of the budget.
While the customs duty mop-up target was scaled down by Rs3,523 crore to Rs84,477 crore, excise duty collection was reduced by Rs4,477 crore to Rs1.02 lakh crore.
Similarly, service tax collection estimates were cut by Rs7,000 crore to Rs58,000 crore.
Sources said this had happened because the cut in excise duty by 6% and service tax by 2% had hit the exchequer drastically. Besides, the slowdown in demand had cut the need for greater imports, affecting customs duty collections.
The government had set the target for direct tax collection at Rs3.70 lakh crore in the 2009-10 budget, but later revised it to Rs3.87 lakh crore.
For the current fiscal, the government has estimated that Rs3.15 lakh crore would be collected through indirect taxes.
Out of this, Rs1.32 lakh crore is likely to come from excise duties, Rs1.15 lakh crore from customs and Rs68,000 crore from service tax.
The government, during 2010-11, proposes to mop up about Rs4.30 lakh crore through direct taxes. Of this, Rs1.28 lakh crore is expected from income tax, despite widening of tax slabs, Rs3.01 lakh crore from corporate tax, and Rs603 crore from wealth tax.
SEBI’s client-broker relationship guidelines throw up operational and cost challenges for brokers; they are seeking relaxation in the rules
Market watchdog Securities and Exchange Board of India (SEBI), in its circular dated 3 December 2009, had laid out rules pertaining to the broker-client relationship in a bid to increase transparency.
Among the various rules were authorising running an account once in a year, increase in font size of all documents and settlement of funds once in a calendar quarter or month. Following apprehensions from the broker community, the regulator extended the deadline to 30 June 2010 from its earlier deadline of 31 March 2010. However there were no amendments to this circular.
While brokerage houses are gearing up to ensure that they comply with the circular, they are still facing operational glitches.
“The implementation faces practical and operational difficulties, for example, quarterly settlement of accounts for all clients on one single day is not possible as it may require a huge amount of working capital for rollover/margins/replenishment of exposures, etc. The broking industry is proposing its relaxation, to at least once a year instead of quarterly adherence. They are trying to impress upon the authorities to find a practical solution—implementing it in batches for a set of clients so that in a given period, all client accounts are settled as stipulated so as to remove the pressure of settling all accounts on a single day. The rotational settlement covering all clients will meet the desired objectives,” said a spokesperson from Anand Rathi.
“Most of the clients have given a mandate to square off the account in a quarter. We are planning to do it from 30th June. We have around one crore demat accounts in the country. If we are told to take new forms from them then there is a cost of Rs100 per form. It will be a very difficult task. There will be a burden of around Rs100 crore on the industry,” said a Mumbai-based broker.
“It is a yearly affair; hence a broker can send statements of balance of funds and securities to all his clients. Of course, it is a subjective matter in terms of cost escalation. Some brokers may charge a cost for the same under courier, despatch charges, etc,” said Chandrashekhar Layane, senior vice president, FairWealth Financial Services.
According to industry sources, some brokers are seeking a further extension and possible amendments to SEBI’s circular.
For renewing the accounts, the operational cost in terms of printing material, paper, and courier charges, etc, per account could go up to Rs25. Printing all documents in a font size of 11 is also likely to add to the costs. Besides, SEBI also has certain modifications to the ‘know your client’ (KYC) forms.
“A running account of a customer with a broking firm is similar in conformity with the established commercial practice for any financial relationship like a banking account, mutual fund account, a buyer and seller (trading) account and a supplier-customer account. An initial authority for setting up such an account with an authority to revoke with the customer should suffice. The new system of periodical squaring off and quarterly statements of accounts strengthens the system further. In view of this, yearly renewal is unwarranted,” adds the spokesperson from Anand Rathi.
The exchanges are trying to convince brokers to implement the circular by 30 June 2010.
Mumbai-based Godrej Consumer Products Ltd said it has entered an agreement to acquire a 100% stake in Laboratoria Cuenca, Consell SA, Issue Uruguay and Issue Brazil (collectively referred to as ‘Issue Group’). No price details were provided.
Godrej Consumer Products Ltd is a major player in the Indian FMCG market with leadership in the hair colour, household insecticides and fabric care categories. The Issue brand enjoys volume leadership in Argentina with a market share in excess of 20%. The business had revenues of over $33 million in 2009.
Godrej Consumer Products ended 2.62% down at Rs312.20 on the Bombay Stock Exchange, while the benchmark Sensex closed 0.15% up at 16,469.55 points.